Former Anambra State Governor and presidential candidate of the Nigeria Democratic Congress (NDC), Peter Obi, has criticized Nigeria’s growing debt profile, urging the Federal Government to emulate South Africa’s approach to public borrowing.
Obi said borrowing is not wrong in itself, but insisted that governments must be transparent about how borrowed funds are used and ensure that such loans translate into visible benefits for citizens.
The former Labour Party presidential candidate made the remarks on Thursday in a post on his verified X account, where he compared Nigeria’s debt management practices with what he described as South Africa’s accountable and transparent borrowing model.
According to Obi, South Africa recently secured a 1 billion dollar loan from the New Development Bank with clearly stated objectives and projects that citizens could identify and monitor.
He said this represents the kind of responsible borrowing that developing countries should embrace.
“I have consistently maintained that borrowing, in itself, is not a bad thing. Every nation borrows,” Obi wrote.
“The critical issue is not the act of borrowing, but what the borrowed funds are used for and whether citizens can clearly see and measure the impact of such borrowing in their daily lives.”
He explained that the South African example demonstrated how governments should handle public debt.
“There is a lot to learn in the open and transparent manner in which South Africa handled its recently secured 1 billion dollar loan from the New Development Bank, with a clearly defined purpose,” he said.
“This is indeed what accountable borrowing should look like; the purpose is clear, the projects are identifiable, and the expected benefits to citizens are measurable.”
According to Obi, when loans are channelled into productive sectors, they improve the quality of life of citizens, boost productivity and stimulate economic growth.
He, however, lamented that the Nigerian situation appears to be the opposite.
The former governor said public debt under the current administration has risen sharply, while many Nigerians remain uncertain about how the borrowed funds are being utilised.
“In Nigeria, however, the opposite is the case: public debt has risen dramatically under the current administration, and its deployment is shrouded in secrecy from the people who will indeed pay back the loan,” he stated.
Obi claimed that Nigeria’s total public debt had increased from about ₦87 trillion in 2023 to nearly ₦200 trillion.
He expressed concern that despite the significant increase, Nigerians had not been given detailed explanations regarding how the loans had been invested to improve critical sectors of the economy.
“Yet, despite this unprecedented accumulation of debt, Nigerians are often left without a clear and detailed account of how these borrowings are being deployed to improve critical sectors such as education, healthcare, power, security and infrastructure,” he said.
The former presidential candidate stressed that borrowing should not become an objective on its own.
Instead, he said, every loan secured in the name of the Nigerian people should be linked to investments capable of generating long-term value.
According to him, public debt should create jobs, reduce poverty and improve the welfare of citizens.
“Borrowing must never become an end in itself,” Obi said.
“Every loan obtained in the name of the Nigerian people must be tied to specific, productive investments capable of generating economic value, creating jobs, reducing poverty and improving the welfare of citizens.”
He further highlighted the importance of accountability in public finance.
Obi argued that governments owe citizens an obligation to explain the purpose of every loan, where the money was spent and what outcomes have been achieved.
“Good governance demands transparency and accountability,” he wrote.
“The government must be able to clearly explain what was borrowed, where it was invested, and what measurable outcomes have been achieved.”
He added that ordinary Nigerians should be able to feel the impact of debts incurred on their behalf.
“The ordinary Nigerian should be able to see and feel the benefits of every debt incurred on their behalf,” he stated.
Obi’s comments come at a time when many Nigerians are grappling with economic hardship, rising inflation and declining purchasing power.
Since the removal of petrol subsidy and the floating of the naira, the cost of living has increased significantly, placing additional pressure on households and businesses.
Food prices have risen sharply, transportation costs have increased and many families have struggled to cope with the changing economic realities.
The country’s debt profile has also remained a subject of public debate.
Successive administrations have defended borrowing as necessary to finance infrastructure projects, support budget implementation and bridge revenue gaps.
Government officials have repeatedly argued that Nigeria’s challenge lies more in revenue generation than in debt accumulation.
However, critics have questioned whether the pace of borrowing is sustainable and whether citizens are receiving adequate value from the loans being acquired.
Economists have also stressed the need for prudent debt management, warning that borrowed funds should be directed towards projects capable of generating economic returns and improving productivity.
Obi said the current economic climate makes fiscal discipline even more important.
“At a time when millions of Nigerians are struggling with rising costs of living, unemployment, insecurity and declining purchasing power, fiscal discipline and prudent management of public resources are no longer optional; they are imperative,” he said.
He maintained that every decision to borrow should be guided by one fundamental consideration: whether it would improve the lives of ordinary Nigerians.
“Every borrowing decision should answer one simple question: How does this improve the life of the ordinary Nigerian?” Obi wrote.
“If that question cannot be convincingly answered, then we risk merely transferring today’s burdens to future generations.”
The former governor’s remarks have added to ongoing national conversations about transparency, accountability and the long-term implications of Nigeria’s growing debt burden.
As the country continues to seek resources to address its development needs, the debate over how loans are obtained, managed and utilised is expected to remain at the centre of public discourse.